Britain should take a tougher stand towards Spain in disputes over Gibraltar, including using legal action and more diplomatic protests, a UK parliamentary committee urged on Tuesday.

Spain disputes British sovereignty over the peninsula, which has long been a point of contention in relations between the two countries, with tensions increasing over the last year.

The Foreign Affairs committee, a group of lawmakers who analyse the work of Britain's Foreign and Commonwealth Office, urged the government to "get off the fence and take a tougher line with Spain" in a report to Westminster.

It recommended the government increase diplomatic protests and summoning of the ambassador, and make London's support for Spanish aims on the international stage dependent on Madrid's action regarding the British outpost.

"The behaviour of Spain toward Gibraltar is unacceptable. We have a situation where a NATO and EU ally is deliberately impacting the economy of a British Overseas Territory," the committee's chairman Richard Ottaway said.

Britain has ruled the area on the southern tip of Spain since 1713, and says it will not return the territory to Madrid against the will of the roughly 30,000 who live there, who wish to remain British.